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In today's competitive market, building and expanding your brand is a challenging task. Consumer expectations have been influenced by major marketplaces, where fast shipping, hassle-free returns, and prompt customer service are the norm. In order to meet these demands, brands often turn to valuable partners such as Ecommerce Accelerators and Ecommerce Aggregators.
The terms Ecommerce Accelerator and Ecommerce Aggregator are fairly new labels used to describe two distinct methods that brands can use to achieve swift online expansion. These options are not in competition with each other.
The year 2020 witnessed a surge in the popularity of the Ecommerce Aggregator model, as the COVID pandemic and other factors accelerated the adoption of ecommerce. Ecommerce Accelerators were already prevalent before the pandemic, but the term gained more prominence as a means of distinguishing between the two models.
To put it simply, Aggregators acquire brands, often smaller ones, and make a profit by expanding their reach and selling more products. Accelerators, on the other hand, establish close relationships with brands to help them attain their growth objectives. They typically buy products at wholesale rates negotiated with the brand and make a profit by reselling them. In the following sections, we will delve into each model and explore their primary distinctions.
What is an Ecommerce Accelerator?
First, let’s define the word.
The term Ecommerce refers to commercial transactions that take place over the internet. Essentially, it is the electronic version of traditional commerce, with the 'e' denoting the electronic nature of the transactions.
An Accelerator can be defined as a factor or entity that speeds up the progress or development of something.
By combining these definitions, we can arrive at a general idea of what an Ecommerce Accelerator does. It is a company that assists brands in selling their products online more rapidly. This definition naturally prompts the following question:
How do Ecommerce Accelerators help brands scale online?
It is important to understand that there is no one-size-fits-all answer to the question of "how" to work with accelerators. Each accelerator has its unique approach, with variations in areas such as marketplace integrations, account management, global reach, and level of service customization.
One of the essential capabilities of Ecommerce Accelerators is fulfillment, which involves delivering orders to customers. Brands are expected to provide fast shipping, with a minimum requirement of 2-day delivery to earn an Amazon Prime badge. This necessitates having adequate warehouse space, a reliable workforce, and an efficient inventory management system. However, not all Ecommerce Accelerators can provide nationwide or global fulfillment services. If your brand requires a fulfillment partner, it is crucial to evaluate the capabilities of the Ecommerce Accelerator you are considering. For instance, Xcelerators provides next-day shipping to 80% of India.
Ecommerce Accelerators offer more than just fulfillment services. Another crucial aspect is marketplace integration or management. While some Accelerators concentrate solely on Amazon, others collaborate with several online retail channels, providing brands with exposure to a broader range of customers. Xcelerators partners with over 15 retail channels to expand brand reach.
Ecommerce Accelerators can offer a range of additional capabilities, including advertising, customer service, reverse logistics, data analysis and growth planning, content management, creative services, and various other services.
What is an Ecommerce Aggregator?
Let's begin by revisiting the definition of the term. As we know, Ecommerce refers to commercial transactions that are conducted electronically over the internet.
At its core, Aggregator refers to an entity or individual that collects materials or information from diverse sources and brings them together in one place.
Therefore, Ecommerce Aggregators acquire small brands or companies that sell their products online. They are currently over 100 Aggregators, with the most prominent in India being Thrasio, Mensa Brands, and GlobalBees etc. These Aggregators generally purchase smaller, private-label brands that utilize the FBA model to sell their products on Amazon.
How do Ecommerce Aggregators help brands scale online?
Ecommerce Aggregators scale brands in a way that is similar to Accelerators. They typically have a team of experts who specialize in advanced ad optimization, improved merchandising, and maintaining adequate inventory levels. They often employ their own technology and tools to inform their strategies.
All of these services resemble those provided by Ecommerce Accelerators. Therefore, the primary decision for brands is whether they want to sell their company or continue to develop it on their own.
Every Ecommerce Aggregator has its own unique procedures and may assign different values to your brand. If you are considering selling to an Aggregator, it is important to do your research. Determine which one is the best fit for your brand and obtain valuations from multiple companies.
Xcelerators is an ecommerce partner that specializes in enhancing brand and channel growth for tomorrow's ecommerce customer. With our team of ecommerce experts, we purchase high-quality products from leading manufacturers and list them on top marketplaces such as Amazon, Flipkart, JioMart, and Shopify. We also provide next-day fulfillment to ensure fast delivery to customers. Our proprietary software gives us an edge in offering exceptional value to our brand partners and channel partners, ultimately leading to high customer satisfaction in India and beyond. Contact us today to see how we can help your business grow.